This article was originally posted on Biz Latin Hub
An Introduction to Coffee in Peru and Australian Cafés
In addition to the booming tourism industry in Peru, astounding cuisine and the stupefyingly beautiful Amazon rainforest, Peru is home to some of the best coffee in the world. The emphasis on ‘best’ is key to this article. Although its export figures for the Arabica bean do rank among the top 5, in terms of sheer quantity, it lags a fair way behind the world’s largest producer, Brazil. However, this is not to be seen as a negative. The reputation of Peruvian coffee is glowing, widely recognised as growing some of the finest speciality ‘niche’ beans money can buy. This article will analyse why the Peruvian coffee industry is a perfect fit for the Australian market, and look at why foreign investment may allow for Peru to finally capitalise on it’s “untapped” potential.
The existence of such remarkably delicious coffee in Peru is by no means a fluke. Not only is it the world’s largest producer of organic coffee, but one of the main distinguishing traits of Peruvian coffee is the variety of tastes and notes. The long and snaking shape of this South American country, coupled with the remarkable natural diversity within its borders, means that coffee is grown in a plethora of soil conditions, altitudes and temperatures. It is arguably this multiplicity in growing conditions that makes Peru so exciting. As highlighted by Darrin Daniel and Geoff Watts of the Alliance for Coffee Excellence in rather floral terms, the pure, unnerving quality of Peruvian speciality coffee is “so laden with sweetness that [it makes] the sugarcane jealous”. Indeed, there was a more formal recognition of the phenomenal standard of Peruvian coffee as the Cup of Excellence competition was held in the 11th largest coffee-producing nation in the world for the very first time in 2017. It yielded remarkably impressive results. 5 ranked a cupping score of 90+, with many originating from the fertile Cajamarca highlands in the north of the country. To top it all off, this really does feel like the beginning of Peru’s march into the luxury coffee market. Daniel and Watts both highlight in their article how all of this high-grade coffee is grown with “minimal assistance”, suggesting a real need for foreign investment in methods, fertilizers and technology.
The USDA reveals that ‘less well-managed farms’ only yield a crop of 800 kilograms per hectare, compared to up to 2500 kilograms in ‘better-managed farms’. The reasoning given for this discrepancy in productivity is the employment of antiquated cultivation techniques and also the infrequent use of fertilisers as a result of lacking the funding to purchase them. It was this lack of fertiliser that made the rust crop plague of 2013/2014 so devastating, killing nearly 40% of crops. This resulted in the Ministry of Agriculture and Irrigation having to initiate a $70,000,000 plan to renew and salvage 80,000 hectares of damaged coffee plants by 2017.
Coffee in Australia
Despite ranking 42nd in the world in terms of average coffee consumption, at a still quite phenomenal 3kg a year per capita, Australia is certainly a country with a strong and affectionate relationship with coffee. The ubiquitous nature of the café culture that has exploded in Australia’s fashionable cities is hugely influential. The relic that perhaps best demonstrates this near-legendary status is the ‘flat white’. Now a regular across the global coffee scene, it is a drink many claim was invented in Australia (New Zealanders may have something else to say on this matter, though!)
Revenue in 2018 for the Australian café industry is expected to reach AUD $8 billion, with imports of coffee expected to reach over 1.81 million bags, representing an increase of almost 5% from the previous year. This will grow to 1.9 million bags by the end of 2019. The main reason that Australian presence in Peru’s coffee industry can be a major success is a result of studies which have shown the growing interest Australians are showing in the whereabouts of their coffee and their insatiable desire for quality, independently sourced beans. The success of the independent café market in Australia has not succumbed to global giants in the same way as other countries have- there are only 23 Starbucks in the whole country! The astounding taste profiles that can be found in Peruvian beans, described as having a “balance of sweetness, of acidity [and] floral components” by Coffee Imports, a leading online coffee trader, would suggest that the coffee can be a real hit Down Under.
The Peru-Australia Fair Trade Agreement or PAFTA is more concrete proof of an increased desire for these two countries to cooperate and nourish a relationship of investment, innovation and development. Currently, Australia imports services and products from Peru with a value of AUD $356 million, whilst it exports close to AUD $70 million. Large investment and the removal of tariffs for all Peruvian horticultural services and produce support my hypothesis that Australian investment in Peruvian coffee could prove mutually beneficial for all parties involved.
Conclusion – Peruvian Coffee and Australian Cafés
So where does this leave us? We have two nations who have expressed a desire to cooperate and develop stronger, longer-lasting and deeper ties with one another. We have a country that is churning out some of the highest quality coffee on earth and one of the most developed countries on earth, which seems to have adopted café culture to the very heart of its urban identity. It certainly does appear that the Australian and Peruvian coffee industries could intertwine and develop a mutually beneficial partnership for all coffee connoisseurs involved.